Over the past six months, Carlyle’s stock price fell to $39.69. Shareholders have lost 14.5% of their capital, which is disappointing considering the S&P 500 has climbed by 21.1%. This might have investors contemplating their next move.
Is there a buying opportunity in Carlyle, or does it present a risk to your portfolio? See what our analysts have to say in our full research report, it’s free.
Why Is Carlyle Not Exciting?
Despite the more favorable entry price, we’re passing on Carlyle for now. Here are two reasons we avoid CG, plus one stock we’d rather own.
1. Long-Term Revenue Growth Disappoints
Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul.
Regrettably, Carlyle’s revenue grew at a mediocre 7.1% compounded annual growth rate over the last five years. This fell short of our benchmark for the financials sector.
Note: Quarters not shown were determined to be outliers because they were impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.2. EPS Barely Growing
We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.
Carlyle’s EPS grew at 9.5% compounded annual growth rate over the last five years. On the bright side, this performance was better than its 7.1% annualized revenue growth and tells us the company became more profitable on a per-share basis as it expanded.
Final Judgment
Carlyle isn’t a terrible business, but it isn’t one of our picks. Following the recent decline, the stock trades at 9.7× forward P/E (or $39.69 per share). While this valuation is optically cheap, the potential downside is big given its shaky fundamentals. We’re fairly confident there are better stocks to buy right now. We’d suggest looking at a fast-growing restaurant franchise with an A+ ranch dressing sauce.
Stocks We Would Buy Instead of Carlyle
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE.
Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.